Rent vs Buy Calculator

Instantly compare the costs of renting versus buying, factor in interest rates, property values, and rental
expenses. Your ideal living situation awaits — let the numbers guide you to your future!

Let's See How
₹ 25 Lac
₹ 5 Cr.
₹ 1 Lac
₹ 5 Cr.
1 Yr
30 Yr
₹ 500
₹ 5 Lakh
Returns Summary
1,37,95,158Value of your house in 15 years
84,47,115 Value of annual EMI if invested
for 15 years
You may be better off buying a house
instead of renting it. You will earn
22,56,600 more as a return on your
* Annual Property price appreciation: 7% (as per historical data).
* Annual Investment Returns: 10% (as per historical Equity Mutual Fund Return).

What is a buy vs rent calculator?

Deciding whether to rent or buy a home can be quite tricky, but this online calculator can help with that. There are many factors to consider when making this decision.

Points to consider:

Buying a house is a big deal and involves a lot of time, effort, and money. Renting, on the other hand, is less daunting because you can easily move out when needed. However, one thing that matters in both cases is the location of the property. Location affects the price of the house and the rent you'd pay. If you're looking to buy a house, it also impacts the type of loan you might need and the repayment terms. You'll also have to think about maintenance costs, as well as additional fees like stamp duty and property tax. These extra costs don't concern you if you're renting.

Deciding Factors:

Property appreciation over time is another location-dependent factor. Since buying a house requires a substantial upfront investment, it's crucial to consider how the property's value will grow compared to other financial options. How long you plan to stay in the house is a significant factor when renting is involved. If you buy a house, it's assumed you'll hold onto it for the long term. But if you're renting, there will come a point when your total rent payments might exceed the house's cost if you stay long enough. With these factors in mind, the rent vs buy calculator can help you compare the financial aspects of renting and buying, making your decision-making process much simpler.

Why use a buy vs rent calculator?

It is crucial to know that if you want to buy a home, you need to be sure you can afford the monthly mortgage payments. If those payments seem too big for your budget, it might be a good idea to consider a less expensive house or a longer loan term. This calculator helps you compare two situations: owning a house or renting the same one.

When you own a house:

  1. You make a down payment and get a loan to own the house right away.

  2. You don't have to pay rent, and your house becomes more valuable over time.

  3. Eventually, when the rent you would have paid becomes more than your loan payment, we invest the extra money to help you when the loan is paid off.

When you rent the same house:

  1. The money you would have used for a down payment is invested in something like mutual funds.

  2. You invest the extra money between your loan payment and your monthly rent. This extra money gets smaller as your rent goes up each year.

At the end of this period, we compare both options to see which one is better for you.

How does this calculator work?

This calculator makes it easier to figure out the money side of choosing between renting and buying a house. Like the actual decision, it considers various factors to give you an estimate of which option is better for you.

It looks at things like how much the house's value might go up in the city you want to live in, the cost of renting, how rent prices might increase over time, and how that compares to the monthly payments for a home loan. It also considers what you might gain by investing the money in other financial options. All this helps you decide if it's smarter to rent or buy a house based on your finances.

The interpretation of the calculator's results involves examining how the two options will affect your finances over time. Here's a breakdown of the key aspects:

  1. Property Value Appreciation: The calculator estimates how the value of a purchased home is likely to increase over time. This projection helps you understand the potential wealth accumulation associated with homeownership.

  2. Rent Costs and Inflation: It considers the cost of renting a property and factors in the expected increase in rent costs due to inflation. This information helps you gauge the financial impact of ongoing rental expenses.

  3. Home Loan EMI: If you choose to buy a home, the calculator factors in the monthly mortgage payments (EMIs) and their impact on your budget over the loan term.

  4. Opportunity Cost: The calculator also evaluates the opportunity cost of using your money for a down payment and home loan versus investing it in alternative financial instruments. This assessment helps you weigh the potential gains or losses from your investment choices.

The interpretation of the Buy vs Rent calculator results involves assessing whether, over the long term, buying a home would lead to greater financial benefits compared to renting.